Wednesday, December 07, 2011

Lower income-earners exempted from tax

PEOPLE earning K10,000 or less per annum will be exempted from paying income tax next year, The National reports.
The 2012 budget presented in parliament yesterday included a number of
major taxation initiatives, minor policy changes and reforms to tax
administration.
“Taxpayers have been facing higher tax burdens due to effects of
inflation in pushing inflation into higher tax brackets,” according to
the budget papers.
The current tax-free threshold is K7,000. This has been increased to
K10,000, meaning a K59 million loss in revenue to the state.
The budget presented by Finance Minister Don Polye also recognised the
importance of the Highlands Highway and has increased the tax credit
scheme funding for its repair and maintenance from 0.75% to 2% –
something which the Chamber of Mines and Petroleum has been asking for.
This will enable projects like the Porgera mine and PNG LNG projects to
commit much bigger amounts of money to help with repairing the highway
that is fundamental to economic growth.

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